The Ramsey Show - App - Being a Dreamer Is Good, but Don't Stop There (Hour 3)

Episode Date: January 7, 2020

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Music Music Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid off home mortgage has taken the place of BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thank you for joining us. Open phones at 888-825-5225. Starting off this hour is Doug in Georgia. Hi, Doug.

Welcome to the Dave Ramsey Show. Thank you, Dave. Nice to talk to you. You too, sir. How can I help? Go ahead. I'm sorry. I said, how can I help?

Well, me and my wife, first, I'm a little nervous, so if I stutter, I apologize. That's okay. We've never lost a patient. You'll be fine. Me and my wife are on baby step six, and we have several variable life insurance policies that we could cash out and pay off the house. But my wife was diagnosed with cancer back when she was like 18, and she's afraid that she can't get any more life insurance if we need it. So we're trying to weigh that out to see what our best bet is. Gotcha. How old are you guys?

I'm 56. She's 54. How long has it been since she's had cancer? 18? She was 18. Okay. So she's very insurable, but you would never drop life insurance policies regardless of your background until you have new ones in place.

Okay. If you needed new ones. Now, what life insurance is for is if she dies, can you make it? Are you getting kids left at home? We do have kids left at home, but they're both working. How old are they? 20 and 24. Okay. All right.

So if she died, could you finish raising them on your income yes my income is 95 percent uh pensions oh okay all right and so you're you're living on a pension now largely and um if so she passed away without any life insurance with the savings you all have in your retirement with your pensions and um with a paid off house which is what we're talking about here if she left you zero life insurance you would be okay that's the equation you want to look at i think so okay you don't have to decide the day but if the answer is that I would need some insurance from her death in order to make it okay, then you would buy some term life insurance on her before you dropped the other policies. And I think she's very insurable.

She's in her 50s. It's been 40 years. Right. We have two SEPs that we've been contributing to also. How much is in those? $130 in one and $150 in the other. You've done a great job. You've done a great job.

And you've got these huge pensions coming into yeah okay now then let's reverse this question and say if you died the pensions are probably gone unless you got have you got spousal survival on them or not i do not and we discussed that and instead of doing spousal uh you'd rather have insurance, we did a term policy on me. Good. Okay, so the variable is on her. Yes. Oh, good.

And the one you would cash out is? Actually, two of them are on her and two are on me. Okay, how much term life is on you? I've got term, five hundred thousand all right so she would have a paid off house in our scenario she would have uh two hundred and something thousand dollars in your seps and she would have five hundred thousand dollars yes okay so not counting the house, she's got about $800,000 if you die, and a paid-for house. Can she make it on that? So if the $800,000 produced 10% a year, that'd be $80,000 a year income without touching the principal.

Now, that's probably not going to do that. That's probably not what you're going to look at. But I'm just kind of giving an example. Can she make it if you die with no variable life in place? And so we're reversing the question on both of you. You don't have to decide this today. It sounds to me like that you probably are what we would call self-insured. The way you become self-insured is zero debt and a big pile of money. Oh, and the kids are grown and gone. That's the other thing that helps you be self-insured,

right? Those two are close. Yeah, and so you just about got rid of them. Well, I mean, not permanently, but out of the house anyway, off the payroll. So the point is, is she going to be okay if you die with $800,000 and a paid-for house? Probably. Are you going to be okay with your pensions and $300,000 and a paid-for house if she dies with no life insurance? Probably. So you're probably okay to just do this, but if you want to have the comfort of a little bit more, you can pick up another $500, you, another $500 on her in term life. It's not going to be super expensive unless you're currently unhealthy. Right.

I'm paying about $145 a month for my policy. Yeah, your term policy. Right. Yeah. Right. Yeah. Right. Yeah. I mean, you could go to ZanderInsurance.com and shop this, but my point is that really this is just some extra gravy on the biscuit. Okay. You got a pretty good biscuit here.

If you want to put some term on it as some extra gravy on it, that's okay. I've also got a deferred comp account. A pretty good bit of money in it, too. Roughly how much? About $550. Oh, my gosh. And that survives both of you as well. Yes. So you're millionaires.

Yes. Way to go. Way to go. That's pretty cool. The only thing we owe is the house so okay so the answer to your question just changed then okay you're self-insured you do not need these variable life policies do you understand uh i do she would have she would have 500 000 plus 200 000 in the steps plus,000 in deferred comp. So she's got like $1.3 million in cash to invest and no bills and no debt on her house if you die.

Okay? If she dies, you've got $800,000 counting deferred comp and a paid-for house and your pensions. You don't need insurance on her. You're okay, dude. You've done it. Touchdown. You scored. Thank you.

Does this make sense? Do you see how I did that? It helps me to hear somebody else say it. Well, but, I mean, you work the math through, and you say, honey, if something happens to me, you invest this money. You sit down with our investment professional. And if you don't have one, go to one of our smart investor pros. But I don't think you need any life insurance.

It doesn't sound like it. And I just did a two-minute analysis of your entire freaking life. So you probably ought to do a further analysis on your life, right? You've done a great job. You can trust your instincts. You have good instincts. They made you a millionaire. Wow.

Way to go. Touchdown, baby. Touchdown. And he was nervous to call. How fun is that? This is the Dave Ramsey Show. Business leaders, right now you have the opportunity to take your business to the next level this new year. You can start by hiring the right people to help your business grow. At Ramsey Solutions, we post on LinkedIn Jobs because they are the best at matching the right person

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today and get $50 off your first job post. Visit linkedin.com slash Ramsey. That's linkedin.com slash Ramsey. Terms and conditions apply. so how many of you have been listening to the show so long that you can quote me you know how to answer the question before i say it but you don't seem to be making traction with your money. See, now that's not good. If you can quote me, but you're not winning, then something's wrong, right? What that means is you're not actually doing some of the things your brain knows to do. We hear from folks all the time who picked up one of the books like the Total Money Makeover.

They've read it. They knocked out the debt. They're killing it with their personal finances. but we also hear from listeners who want more more accountability more encouragement more interaction with other people in community who are on the same mission to bust debt right in the nose that's why financial peace university works it's all of our teaching in one place. We not only show you how to pay off debt. We not only show you about insurance. We not only show you about buying the right house. We not only show you about investing to build wealth.

We show you about generosity. And if you've never taken Financial Peace University right now's time, because it includes a huge community that you plug into. It includes all kinds of accountability and encouragement. It's not simply content. If content would do it, you would have already done it. That's most of us. Most of us kind of know what to do, but we just need somebody that's got their arm around us

when we're kind of hurting and somebody kind of kicking us in the butt when we're being a little lazy. And that's accountability and encouragement, right? We all need that. So go to DaveRamsey.com, and this is your year for Financial Peace University. Or call the Ramsey Concierge Team at 888-22-PEACE, 888-227-3223. Carrie's in Indiana. Hi, Carrie. Welcome to the Dave Ramsey Show. Hi. Thank you for the opportunity to speak with you. 888-227-3223. Carrie's in Indiana.

Hi, Carrie. Welcome to the Dave Ramsey Show. Hi. Thank you for the opportunity to speak to you. Sure. How can I help? Our youngest two children have come into an inheritance. That's a substantial amount of money.

And we were trying to find the best way to handle it, whether to leave it in a savings or to invest it some way. We had considered investing in a piece of property maybe for them. How old are the children? They are 13 and 5. Okay. And how much money did they inherit? Right now we know they have a life insurance policy that's $35,000 each for them, and then there's a 401K that he'd invested in for at least 20 years. We're not sure how much that one is yet.

Okay. All right. What I would do is simply put the money into some mutual funds. Get in touch with a SmartVestor Pro in your area. Click SmartVestor at DaveRamsey.com. I'm not in the investing business, but these are the people, one of the 1,200 people in America that we have vetted to have the heart of a teacher for you to understand what you're investing in.

But, no, I would not buy property with it. This is going to be used for their future, be used for their college, maybe helping them with their first car. And if there's enough money to survive both of those things, then maybe even their first home. And so that's your first step is just do some good quality, solid, basic investing. And that's what I would do if these were my children. So sit down with someone that has the heart of a teacher, you and your husband.

You might even take the 13-year-old with you. Maybe not this trip, but another trip later when you sit down with your broker later, because this is an advisor that's going to be with you for the next five or 10 years. Right. Yeah. I just wanted to make sure we were doing what was best for them. I mean, it's easy to put it in a savings account. I would not put it in a savings account. At least it's it, but Right. Because the inflation rate is four and a half percent right now, and the savings account is paying one. So you're losing three and a half percent of purchasing power every year when you have a savings account. Right. You've got to outperform that, number one. And if you're saving for college, the inflation rate of tuition is

about seven and a5% a year. So you've got to do better than 7.5% to even keep up with the cost of college. So some good mutual funds should accomplish both of those goals, should be able to keep that going. So if you made 10% or 11% instead of 1%, that's a big deal. Right. But take your time. Understand how mutual funds work. You're doing this for your children. Understand how mutual funds work. You're doing this for your children.

You want to be responsible. And as they grow, you're going to want to teach them about this money. Don't surprise them with it when they're 21 and go, hey, by the way, you got $150,000. The 13-year-old already knows about it. Okay, that's good. And it has to go. We had to go through a court to get guardianship over it, so it'll be monitored. Yeah.

Also, because the way... The court may dictate what you do with the money. Right. It's possible. That's why I wanted to have something prepared to take, too. Yeah. Some conservative mutual fund investments, sometimes you can talk the court into doing. Okay.

Sometimes the court is stupid, because they're afraid you're going to screw something up as parents and they're trying to protect the kids and they make you put it into a CD. And so you're going to lose your butt if they do that. So I would argue with the judge if that was the case, but I'd have a professional investment advisor with a solid plan and you can present that to the court. And usually you can get the court to hear you on that. Most judges are sophisticated enough now that they know what a mutual fund is. Twenty years ago, they would make you put it in a CD, and you were just getting screwed just because they were scared

you were going to mess the kid up. Right. But most of the time now, most judges are sophisticated enough. Not all of them. Some of them are dumber than a rock on this stuff. But that's the court. You know, that's who the court is. It's a person.

So you've just got to go in there and hope you get a judge with some wisdom and some actual marketplace knowledge of investing. But you're not suggesting they're not going to let you buy property with it if it's in a conservatorship like this. Okay. And so that's just not an option. The good news is that 401k of his may already be in mutual funds and this may become an inherited IRA. And so it might make it really easy for that to stay in mutual funds from the court's perspective. That's the other thing to

look at. So once we've done all of that, then the next job you've got is to begin age appropriately teaching them about money. We're not trying to overwhelm them with responsibility or overwhelm them with, I think they've got enough money to buy all the candy in the store. That's not what we're trying to do here. But we do want them to learn about money because a big pile of money is as big a curse as it is a blessing if you're not ready to handle it right and so i openly discuss finances with my kids not like what our bills are but you know is it a need a necessity yeah and you know how do we do we live on a budget do we stay away from debt um you know are we going to put the whole thing into a car

which goes down in value no we're going to put the whole thing into a car which goes down in value no we're going to put money into an education that's valuable as long as it's a valuable education that's usable yeah and so like they should pay for part of their own education like i want them to have help with it but i want them to earn some of it too that's fine too i got no issue with that so i'll tell you what rachel and I wrote a book. It's a number one bestseller on this called Smart Money, Smart Kids. It's about teaching parents like you how to teach their kids how to handle money so they turn out like Rachel or Daniel or Denise. All three of my kids are very good with money. And that was not an accident. It was a series of teachings throughout their entire life that were age appropriate. So hang on, I'll give you a copy of that and it'll help you get going. It was a number one bestseller. It's a series of teachings throughout their entire life that were age-appropriate. So hang on.

I'll give you a copy of that, and it'll help you get going. It was a number one bestseller. It's a great book. Rachel did a good job with it, and I did a decent job. All right, open phones at 888-825-5225. We appreciate you guys joining us. This is it. The average shopper spent close to $1,000 on Christmas this year.

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NMLS ID 1591. NMLS ConsumerAccess.org. Equal housing lender. 1749 Mallory Lane, Suite 100. Brentwood, Tennessee 37027. For a limited time only, this offer is applicable to closing costs and is not combinable with other offers. Thank you for joining us, America. This is the Dave Ramsey Show. Tony is in California. Hi, Tony. This is the Dave Ramsey Show. Tony is in California.

Hi, Tony. Welcome to the Dave Ramsey Show. Hey, Dave. How are you doing today? I appreciate all you do. Thank you, sir. How can I help? I have a question relating to an investment that I'd like to make at this time in my life.

I'm looking at buying a triplex. Potentially, I'm in the real estate business. And based on my current situation, buying in Southern California is not always the easiest. But I have an opportunity, I believe, to make a difference for the long term and wanted to get your feedback on it. Okay, you're going to live in one of the units?

No. I have a wife and a one- your feedback on it. Okay. You're going to live in one of the units? No. I have a wife and a one-year-old son, and we already own a house, and we're not going to be living in there. We're set in our house probably for the next 20 years. Good. Good. Cool. What city are you in?

We're in San Diego, a suburb, Rancho Bernardo. Yeah. Nice, expensive market Bernardo. Yeah. Nice expensive market. Okay, good. Yeah, average house price about $450 now in San Diego. Where in America it's about $220. Yeah. And $450 doesn't buy much.

So, okay, what's the triplex cost? I think I can probably get it around $8,000 to $850,000. Okay. Are you out of debt? Are you out of debt? Well, I will be. We sold our first condo, and with the gains from that, we're going to be able to pay off our two cars, and that's all the debt we had. You don't owe money on your home?

Oh, we do. Sorry, except the house. I that's all the debt we had. You don't owe money on your home? Oh, we do. Sorry, except the house. I wasn't considering the home. Okay. Yeah, we owe $640 on that. It's on a 30-year fix. We're paying it at a 15-year, and we just refinanced that at the end of the year. Okay.

All right. Well, you're in the real estate business. I grew up in the real estate business. I got my license in 1978 when I was 18 years old. And so I've been in and around the real estate business and real estate people my whole life. If you don't know my story, I started buying real estate when I was 23 years old. By the time I was 26, I had about $4 million worth. And I did the buy everything in sight routine, right?

And I was buying stuff at good deals. I was buying at 70% of value or less. I was buying a lot of foreclosures and doing a lot of rehabs and that kind of stuff, and I was pretty good at it, but I just had a lot of borrowed money, obviously. And what I discovered, the reason I'm telling you all that is I went broke doing it because the bank called our notes, and so that's how I discovered this whole idea of getting out of debt and staying out of debt. Today I own several hundred million dollars in real estate, but it's all paid for. I pay cash for it when I buy it always.

And I'm not bragging. I'm just trying to share with you my perspective, okay? That happened 30 years ago when I went broke um and i 40 years ago almost i got the opportunity to start again but um so the uh um the the thing is that real estate people and you're real estate people i'm real estate people so i can talk about us our risk meter is damaged or broken. We don't measure risk well. In other words, we don't associate the $700,000 or $800,000 mortgage on this triplex with risk.

And it is risk. It's a lot of risk. Debt equals risk. In business and publicly traded companies that have a big set of bonds, they're in debt. We discount their stocks because they're so leveraged. If they have a lot of puts and calls, they have a lot of problems with warrants with their banks. Large companies that are in debt, we devalue their stock, meaning we don't think they're worth as much because of risk. We don't do that in the real estate business.

We just go, buy it all. You know, that's our world because we just don't associate mortgages with risk. I do because I've been broke and because I've also been wealthy without any debt. And so I really understand there's no risk, which is really kind of cool. Like in 2008, when everybody was crying and jumping off buildings and stuff, I was buying property. Yeah. Because I didn't have any debt and I had a pile of cash. I got some of the best buys of my life.

So all of that speech to tell you, I'm going to tell you something you're probably not likely to do because I know who you are now that we've talked a little bit, but it's still the advice that I would tell you to do, and it's what I have done, and that's get your home paid off and then save up and pay cash for your investment properties. You will build your portfolio slower, but you will never have to start over. Yeah. And if you have your house paid for, it changes the way your productivity happens in your business.

Yeah. You're a straight commission guy out there selling houses. Well, I'm in property management. I'm in property management too and that's kind of the trick is i've uh yeah i i own the company and i manage a lot of properties and and so okay well then you see that and you know let's take that eight hundred thousand dollar triplex for an example this is good for everybody to listen in on us talking that's how this show works but let's just take that property for for example. With a couple hundred down, you've got a $600,000 mortgage on the thing.

Let's say that's one of your customers, okay? If they fill that triplex up, when they take vacancy out, when they take repairs out, they take the occasional filing of a Chapter 13 by a tenant or a Chapter 11 or even a 7 by a tenant where it takes forever to get them out of the property, and yet they get to stay in there for free. When you take that out, real-world operations of a piece of real estate, in other words, and then you pay the payment with a 20% down on an $800,000 property, you don't even cash flow. No, you don't. That's called risk yeah this becomes a problem rather than a blessing and you haven't you have unique insight of that because you're an actual

property manager because you know what most people say about real estate they go oh well my payment is four thousand dollars a month and i'm collecting six thousand dollars in rent translation they're probably losing money a lot yeah well and and i i definitely understand that and i i love what you talk about you know and and the idea of investing in other areas and out of state where the margins are better and you can get better cap rates and you can buy cash you know i can take this cash and invest it elsewhere but my thought was i, and now based on what you're saying is save up. If I want to buy local so I can manage it, buy something that's manageable and keep my eye on it for the rest of time.

And just pile it. And here's the thing. Every time you get another one that's paid for, your cash flow is like awesome. A paid-for property cash flow is like a bandit. Yeah, yeah. No, that's awesome. Yeah. And so you get the snowball rolling.

How old are you? 32. What's your household income? About $257. Man, you're killing it. You're doing great. Yeah. You're doing great income.

Thank you. Yeah. So you're not – how much is your house mortgage? What's your balance on your house? $640. Oh, yeah. And the payment's about $37, and we're going to put, we're putting $1,500 extra a month on that to knock it out in 15 years.

But you're right, I have that cash there. You could knock it out sooner. I mean, yeah. I mean, what if you were sitting there making $250 with no house payment? How quick can we buy the first property cash flowed? Pretty quick. Yeah. You got a big shovel, dude.

You got a big shovel. You can do this. But what it's going to do is it's going to require this itch that you've got, because you're a real estate guy, doesn't get scratched for a little while. Yeah. And that's going to be hard for you. It's going to be really hard for you. Just put it off.

Yeah, just put it off. Okay. That's my pitch, dude. That's going to be hard for you. It's going to be really hard for you. Just put it off. Yeah, just put it off. Okay. That's my pitch, dude. That's my pitch. It's how I live my life, by the way. I don't ask you to do something I didn't do. And I got to tell you, man, it's been hard for me to, when I see a piece of real estate that's a deal and I don't have the money,

it's hard for me because I love a deal. And I love dirt and bricks and mortar and rent, and I just love real estate. I'm just a real estate guy. Mom and Daddy were in the business when I was growing up. I mean, I've been in it my whole life. I love it. But when you do it wrong, it's the biggest curse in your life,

and people rationalize and justify it because they don't count risk in the equation. So it was a good discussion. Thank you for letting me have it with you. And it gives you something to chew on, a different way of looking at things. I'm probably the only guy you'll run into this week that had that opinion. Everybody else will tell you, oh, yeah, just buy rental property. Yeah, as if there's no tomorrow. Amen.

Thanks for the call. This is The Dave Ramsey Show. Thank you. Our Scripture of the Day, Romans 15, 4, for whatever is written in former days, was written for our instruction, that through endurance and through the encouragement of the Scriptures, we might have hope. Colin Powell said, A dream does not become a reality through magic.

It takes sweat, determination, and hard work. Amen. See, you do want to be a dreamer, but you don't want to stop there. Isn't it funny? People tell you you have big dreams, but they don't be a dreamer. Yeah, you do want to have big dreams, but being just a dreamer, what that means is, is that you don't do anything. You just talk about stuff all the time. Like if your daughter comes home and she's dating a guy and she says, oh dad, he's a dreamer. You go, oh crap, they're

going to live in the basement, right? That's what you think of when you think a dreamer, right? So dreams are a big deal. You need to have a dream. But if you stop there, then you're just a dreamer. Dreams, you need to blow the clouds off the dreams and let them become visions. And visions with work clothes on are called goals. And then you start getting very specific and you ask yourself, what must be true for us to be able to do that? For me to be in that career, for me to lose 30 pounds, for my marriage to be better, for my spiritual walk to be different, my relationship with God to be stronger, what has to be true that's not true now?

What has to change? What books do I need to read? Classes do I need to take? Classes do I need to take? Different people do I need to associate with? If you've got a drinking problem and you continue to run around with your drinking buddies, you're going to have a drinking problem. Something needs to change. You become who you hang around with.

You talk like them. You read the same books they do. You watch the same books they do, you watch the same movies they do, and you binge watch the same series on Netflix that they do. But if you start running around with a bunch of people who are unbelievably generous, they are careful with their money so that they can be unbelievably generous. They get out of debt and stay out of debt, which makes them in our culture weird. And you start running around with people that are doing that,

you're much more likely to do it. That's why we put you in accountability groups in Financial Peace University. It's called positive peer pressure. It helps behavior modification. It's basic stuff, y'all. That's how it works. You become who you hang around with. You know this because you don't let your children run around with people who are misbehaving. If little Johnny down the street

smoking weed, you don't want your little kid running around with little Johnny because your kid will be a weed head. You know? You know this. You know that they're going to become who they hang around with. You ever send your kids off when they're eight years old to play at the neighbor's and they come back using words we don't use at our house? That was not accidental. That means that kid or those parents are using those words at that house. What do you mean you're dropping the F-bomb at eight years old in my house? What, do you want to live?

I mean, I can make another one just like you. I'll take you out. You know, you're not going to do that here. I mean, you know, have you ever had that experience with your kids? That's because of who they were running around with. It's simple. You're going to become who you hang around with. Do you know your income will be approximately within 10% to 15% of the average

of your closest 10 friends over a 10-year period of time if you run around with people that say the little man can't get ahead you're running around with losers if you run around with people to say well you know people like us can't win i had a friend of mine that's very wealthy and he grew up in the hood that's what he calls it And he said you know Dave Getting out of the hood was a lot easier Than getting the hood out of me The tapes that are played from your childhood

The tapes that are played from the people That supposedly do love you But that are misguided In your head That say things like people like us can't get ahead. Don't you understand? Don't you understand that people from the South are all treated like they're ignorant

and live in double wads and walk around with no shoes by a bunch of you Yankees? Don't you understand that people in the South think all you people in New York are rude? And I'm actually friends with all of you, so I'm okay. I actually love New Yorkers because they do speak their mind and they get straight to the point. And they never say, bless your heart, which in the South can mean anything. You know, so I mean, you become who you hang around with y'all getting this down you become who you i mean if you believe if all you hang around with are people that talk politics from your side of the aisle it's the only talking point you know and you've not had an original thought in years and develop your critical thinking skills and get past the idea

that barack obama or or Donald Trump are the savior. Because neither one are. And by the way, none of them have ever sent me any money. Everything good that's happened in my life, none of it came out of Washington, D.C. None of it. So, I mean, who are you running around with? You got your around people waiting on washington to fix their life are you running around with people that say education's a bad

idea are you running around with people that say oh yeah student loan debt no matter what you pay for it is worth it are you running around with people that fill in the blank you're going to become just like them a dream does not become a reality through magic colin Powell said. It takes sweat, determination, and hard work. Michelle is in Ohio. Hi, Michelle. Welcome to the Dave Ramsey Show. Hi, Dave. Thanks for taking my call.

Sure. What's up? So I am just getting started. Just kind of read through the Money Makeover book, and I'm getting started. And I'm almost through Baby Step 1. So I was trying to look at my um starting to like set up my debt snowball um and I most of my debt is student loan debt I wish I would have known a little bit more before I went to school but long story short I have about 72 grand in debt um it's all in federal federal loans what's your career this month um i'm working as a early childhood educator

um kind of currently in in daycare looking to move up from that okay um i mean i make decent money for for that profession but um so long story short i have 18 or 19 student loans um just all through the department of education um they all range from like $300 is the lowest to like $11,000 or $12,000 is the highest. So I didn't know. I know you say the only debt you consider consolidating would be student loan debt. I didn't know if it would be beneficial to consolidate or just attack it small or large in my debt. So I didn't know.

It doesn't hurt either way. The only benefit of consolidation is if you get a lower overall rate, a lower aggregate rate, and or you get rid of some variable rates if you got that many loans. So it's possible that you could lower your overall rate. That doesn't hurt anything. And one of our sponsors is Splash Financial. Okay.

Google them and look them up, Splash Financial, and they don't have any closing costs or any refinance costs or anything, and there's no prepayment penalty when you do it. You can only consolidate federal student loans one time. Right. And that's why I was like, I don't want to do it if it's not, you know. Yeah. And I didn't know, like.

But what are your interest rates? Four to six. I haven't looked at it, honestly. Okay, you need to add them all up, and basically if all the little ones are six and all the big ones are four, but you got a five rate, you wouldn't want to do that, right? Right, right. But if all your big ones are six and you could get a five rate, you might want to do it.

Okay. But see, here's the thing. $70,000, if you save 1%, which it sounds like is about what you're going to do, you might save two, but 1% on $70,000 is $700. Yeah. $700 does not solve a $70,000 is $700. Yeah. $700 does not solve a $70,000 problem. Yeah. So it's okay to consolidate it, but

99% of your solution is you. You're the secret sauce. The consolidation is only 1% of the solution. Check SplashFinancial.com SplashFinancial.com and they'll help you with this. But again, you're your secret sauce

always in these situations hey thanks for the call that puts us out of the dave ramsey show in the books we'll be back with you before you know it in the meantime remember there's ultimately only one way to financial peace and that's to walk daily with the prince of peace christ jesus Christ Jesus. make sure you visit DaveRamsey.com slash show and register. We would love for you to come to Nashville and tell Dave your story.